Messaging app LINE has officially launched a cryptocurrency exchange service for its 80 million users based in Japan, days after the platform received final regulatory approval.
The Shinjuku-based messaging provider, which is 73.36-percent owned by South Korea’s Naver, said in a statement on Tuesday that the new exchange, dubbed Bitmax, is now live with trading of five crypto assets: bitcoin (BTC), ethereum (ETH), ripple (XRP), bitcoin cash (BCH) and litecoin (LTC).
According to the statement, the service was introduced in stages from 3 p.m. Japan time on Tuesday and is available first on Android devices. It can be accessed via the wallet tab on the LINE mobile app and is also integrated with LINE Pay to provide an easier Japanese yen fiat on-ramp process.
LINE said in the announcement it currently has 81 million monthly active users in Japan and 164 million globally. It operates the crypto exchange through LVC Corporation, a subsidiary, which was awarded a cryptocurrency exchange license by Japan’s Financial Services Agency on Sept. 6.
BITMAX is available to residents of Japan with a LINE account. No fees are charged for trading, though a charge of 108 yen will be applied for deposits and withdrawals.
In terms of security, LINE said it utilizes a wallet developed by Palo Alto-based BitGo to segregate customer assets and store assets in a cold wallet, which is itself managed by a dedicated team.
A strict KYC process is in place for new customers. Applicants can register their account with the app using an ID card and photographic capture, with a registered bank account and an ID or by mail.
The new service will run separately from the company’s Singapore-based Bitbox, which has been in operation since July 2018 but excludes residents of Japan and the U.S.Jinhee Lee, Chief Innovation & Product Officer, at LINE’s unblock corp via CoinDesk archives
The U.S. Commodity Futures Trading Commission (CFTC) has just named Coinbase vice president Dorothy DeWitt as its new market supervisor.
CFTC Chairman Heath Tarbert announced in a press release Tuesday that DeWitt, who is also the exchange’s general counsel for business lines and markets, will be the new director of the Division of Market Oversight (DMO), the group responsible for overseeing derivatives platforms and products, including the young market for bitcoin futures.
DeWitt has also spent time at Citadel Securities, S&P Global and Davis Polk & Wardwell, and has previously been a portfolio manager.
Her new role will see her evaluating and potentially approving new bitcoin derivatives products in the U.S. DMO has examined CME, Cboe and Bakkt’s various bitcoin futures proposals in the past.
She succeeds former DMO director Amir Zaidi, who oversaw the first bitcoin futures contracts as they entered the crypto space in late 2017.
In a statement, Tarbert thanked Zaidi “for his more than nine years of service at the CFTC,” saying:
“[DeWitt] brings to the CFTC more than 20 years of private sector experience in the financial services and legal fields. Her strong investment, risk, legal, and compliance background and familiarity with distributed ledger technology, including crypto assets, will be invaluable as the agency looks to develop a holistic approach to regulating 21st century commodities.”
Former DMO director Vince McGonagle has been serving as acting director of the division during the transition period.
Tarbert first took office in July 2019, after Congress confirmed him in June. The former Treasury Department official succeeded Christopher Giancarlo, who was famously dubbed “Crypto Dad” after advocating for a “do no harm” approach to regulating the crypto space before Congress.
Since leaving the agency, Giancarlo has joined the advisory board to the Chamber of Digital Commerce, a trade association focused on blockchain and cryptocurrency policy in Washington D.C.
Blockchain startup SpaceChain has won a 60,000 euro grant from the European Space Agency (ESA) to investigate use-cases for their satellite-based blockchain wallet system.
Announced today by the company, the grant by the ESA’s “kick-start activities” fund bolsters SpaceChain’s efforts to put a hyper-secure, multi-signature, distributed satellite network in orbit. The company has already flight-tested blockchain nodes in space.
The tech uses a three signature system, with two ground-based signatures and a third in orbit, on the satellite. Each transaction requires at least two of the three signatures to complete.
Zee Zheng, SpaceChain’s co-founder and CEO, told CoinDesk that his satellite-based nodes are far more secure than terrestrial networks processing on the open internet with data and protocols uplinking directly to the satellite.
“We don’t need internet access to perform this kind of transaction,” Zheng said, “which eliminates a lot of potential risks for hacking.”
“We are looking at a market that last year saw $1 billion in crypto stolen. That will be much much more difficult for hackers [on our system],” he added.
Zheng called his grant from the ESA an opportunity for the crypto community to learn more about blockchain space applications. He noted developers’ high interest in the security upside.
“We want to use this opportunity to showcase how space can benefit the blockchain space,” Zheng said. He added SpaceChain plans to launch three times over the next 18 months.
A blockchain startup for ethical supply chain management just raised $4 million in seed money.
OpenSC, a joint venture of the Boston Consulting Group and environmental protection group the World Wide Fund, announced today $4 million in seed funding from investor Christian Wenger. OpenSC uses blockchain technology to track goods for ethical malpractice.
The capital will be used to further develop blockchain-based supply chains such as overfishing and human rights violations, incoming OpenSC CEO Markus Mutz told CoinDesk. With the funding, Mutz left his role as a director at BCG Digital Ventures to be the full-time CEO of OpenSC.
The funding round came on the heels of its international pilot project with Austral Fisheries, one of the world’s largest seafood companies. OpenSC helps Austral monitor the fishing process of its Patagonian Toothfish — more commonly known as the Chilean sea bass.
The fishery company collects data from fishing boats’ GPS and put the fishing locations in the blockchain platform through an automated algorithm.
Retailers and customers throughout the supply chain can learn where the fish are caught and who catches them by scanning the QR code on the products, Mutz said. The blockchain platform will increase transparency between suppliers and customers throughout a supply chain so that it will be easier to monitor the whole process.
Mutz said the company will also work with Nestlé to trace the food company’s milk products from farmers in New Zealand to customers in Middle East and palm oil sourced in the Americas.
The Nestlé project will apply OpenSC’s blockchain technologies to a large-scale supply chain, which could serve as a model for other big companies, he said.
Cryptocurrency exchange Binance, the world’s largest by trading volume, has made a strategic investment in Chinese media and data source Mars Finance.
According to a report from Bloomberg citing a press release, the investment amount was not disclosed, but values the company at $200 million.
Aside from Binance, which reportedly made its first strategic investment in China with the round, Beijing-based Mars Finance was also backed by Ceyuan Ventures and Matrixport, a financial services startup founded by co-founder of bitcoin mining firm Bitmain, Jihan Wu.
Discussing the investment, Binance CEO Changpeng Zhao said:
“We have large respect for data, news and research firms which support the positive growth of the blockchain industry. We will continue to pursue strategic investment opportunities in our mission to bring crypto further mainstream, increase adoption and accessibility, and help the industry grow sustainably.”
The media site was founded by tech entrepreneur Wang Feng in 2018, Bloomberg says, and has previously raised two funding rounds from investors including IDG Capital and the venture subsidiaries of OKCoin and Huobi.
The firm’s website indicates it also offers market reports and a VC fund called Consensus Lab (no relation to CoinDesk Consensus).
The news comes as Binance’s new U.S. platform prepares to onboard customers in preparation for live trading.
Binance.US said last week that it will open registration and deposits Wednesday, Sept. 18, after which it will roll out a number of Binance products across the U.S.
Native support for bitcoin cash is coming to HTC’s blockchain phone.
Today, HTC announced its partnership with Bitcoin.com to add bitcoin cash support for its Exodus 1 blockchain phone. The new function will come with Bitcoin.com’s preinstalled wallet and be rolled into the Exodus 1 software update. Bitcoin.com will also sell the Exodus 1 and all future versions.
In a statement, HTC’s chief decentralization officer Phil Chen called the update a natural next step for the phone. “The Zion Vault is happy to support BCH natively in hardware so security goes hand-in-hand in the BCH blockchain as an alternative to dominant payment rails and platforms,” he said.
With the partnership, Zion Vault, the phone’s key management software can now secure BCH transfers by signing off on transactions.
First announced at Consenses 2018, HTC has regularly updated the Exodus 1 with new blockchain features. An update in May allowed users to directly swap cryptocurrencies within the Zion Vault wallet.
Exodus 1 may soon be replaced by HTC’s second-generation blockchain phone: the newer, cheaper Exodus 1s. Chen has previously told CoinDesk that the $200-$300 phone would ship in the third quarter.
The computing power dedicated to mining bitcoin has hit yet another new high, suggesting that more than 600,000 powerful new machines may have come online in the last three months.
According to data from crypto mining pool BTC.com, bitcoin’s two-week average hash rate has crossed another major threshold, reaching 85 exahashes per second (EH/s) around 19:00 UTC last Friday. Meanwhile, mining difficulty also adjusted to a new record of nearly 12 trillion.
Notably, both figures have jumped 60 percent since June 14, the data shows.
Bitcoin’s mining difficulty – a measure of how hard it is to create a block of transactions – adjusts after 2,016 blocks, or roughly every two weeks. This is to ensure the time to produce a block remains around 10 minutes, even as the amount of hashing power, deployed by machines around the globe competing to win freshly minted bitcoins, fluctuates.
Several new models of application-specific integrated circuit (ASIC) miners hit the market over the summer, with an average hashing power around 55 tera hashes per second (TH/s).
Assuming all of the 35 EH/s of new hashing power added since mid-June came from these top-of-the-line models, a back-of-the-envelope calculation suggests that more than half a million such machines have connected to the bitcoin network. (1 EH/s =1 million TH/s)
These powerful ASIC miners, made by major manufacturers such as Bitmain, Canaan, InnoSilicon and MicroBT, are priced from $1,500 to $2,500 each. So if more than half a million of them were delivered, as estimated above, the leading miner makers could have made $1 billion in revenue over the past three months.
Bitcoin’s spiking hash rate and difficulty are in line with the soaring price since earlier this year, which led to increasing demand for mining equipment that has significantly outstripped supply. It’s also in part thanks to the rainy summer season in southwestern China which resulted in cheap, abundant hydroelectric power.
Further, there has also been a growing interest in Russia’s Eastern Siberia region, where the Brastsk hydropower station built in the Cold War era has been utilized to power mining farms that are estimated to account for almost 10 percent of the total computing power on the bitcoin network.
Miners in China estimated earlier this year that bitcoin’s average hash rate in the summer would break the level of 70 EH/s, which happened in August.
As such, major miner manufacturers have already sold out equipment that is due for shipment until the end of the year with customers placing pre-orders three months in advance.
TokenInsight, a startup that focuses on analysis of crypto trading and mining activities, said in a report published Friday that additional supplies of miners are expected to hit the market in the coming months.
“Following the drastic increase in bitcoin’s price, the bitcoin mining market saw significant inflation in Q2 2019. Most of the miners from various manufacturers were in serious shortage and pre-orders submitted in Q2 and Q3 are to be delivered by the end of the year,” the report states.
Therefore, the firm estimates mining difficulty will maintain its growth momentum to reach 15 trillion by the end of the year – with bitcoin’s average total hashing power crossing the threshold of 100 EH/s for the first time in its history.
Liquid, a second layer tech for bitcoin created by Blockstream, just onboarded another crypto partner.
The sidechain for faster BTC payments now has around 30 members, including Bitfinex, BITMex, OKCoin, and other exchanges, with the total of $900,000 moving around on the network, Blockstream’s chief strategy officer Samson Mow told CoinDesk.
Now Canadian bitcoin exchange Bull Bitcoin is joining the platform. The new partnership will allow the users of Bull Bitcoin to interact with other exchanges on the network.
Tentatively scheduled on the early 2020, the integration of Liquid tech into Bull Bitcoin’s operations will require some effort from the exchange’s tech team, Bull Bitcoin CEO Francis Pouliot said.
“We’re making sure we have this backup layer. We want to make sure bitcoin succeeds, and this is our way to participate in strengthening the network,” Pouliot told CoinDesk.
As a part of the partnership, Bull Bitcoin is going to issue its own asset on the Liquid network: Canadian dollar-pegged token dubbed L-CAD, which is supposed to be used as the exchange’s voucher for buying bitcoin.
The popular inter-exchange settlement network, Liquid has collaborated with Canada-based bitcoin exchange, Bull Bitcoin turning its member score to nearly 30.
Based on the reports concerning the Bull Bitcoin partnership with Liquid Exchange Network, the investors using the Bull Bitcoin platform will now be open for interaction and communication with other popular exchange networks on Liquid’s sidechain.
The integration is tentatively scheduled to take place in the early phase of 2020. Bull Bitcoin CEO, Francis Pouliot stated that the collaboration would need some inputs from the technology arm of the exchange for the successful integration.
After a nine-month delay and $3.8 million of investment, an upstart manufacturer is ready to produce its first batch of powerful new machines for mining cryptocurrencies ethereum and ethereum classic.
Linzhi, based in Shenzhen, China, said Wednesday it had ordered 37 wafers from Taiwan Semiconductor Manufacturing Company, the main parts that will allow it to build about 200 application-specific integrated circuit (ASIC) miners.
These sample units will test whether the machines can mine as efficiently as they are designed to do using ethash, the proof-of-work algorithm used on ethereum and ethereum classic.
The testing units, if successful, would mark a major step toward mass production as Linzhi sets out to compete with makers of general-purpose computing chips, such as NVIDIA, as well as mining gear specialists Bitmain and InnoSilicon, which both make ASIC miners for the ethash algorithm.
Roughly five million ether (ETH), the native cryptocurrency on the ethereum network, is being mined every year, which, at its current price, is worth more than $800 million. Even for ethereum classic, which maintains the original ethereum ledger from before a hard fork in 2016, about nine million native ETC gets mined every year, worth more than $60 million.
Linzhi was founded in February 2018 by Chen Min, a former chip design head at Canaan Creative, maker of the Avalon bitcoin miner. Chen told CoinDesk the new company was completely self-funded with about $4 million as starting capital.
It announced the plan to produce ethash ASIC miners in September 2018 with an ambition to beat the efficiency of most existing equipment. Chen’s target specification for Linzhi’s ethash ASIC miner is set at 1400 mega hashes per second (MH/s) with an electricity consumption level of one kilowatt-hour.
To put those figures in perspective, NVIDIA’s GTX TitanV 8 card is now one of the most profitable piece of equipment on the ethash algorithm, able to compute 656 MH/s at an energy consumption level of 2.1 kWh, according to mining pool f2pool’s miner profitability index,
With ETH’s current price ($180) and network difficulty, as well as an electricity cost of $0.04 per kWh, each GTX TitanV 8 would bring home a daily profit of $7.35. Similarly, if one uses the same GTX TitanV 8 card to mine ETC, which has both a lower price and a lower mining difficulty than ETH, the daily profit would still be around $6.70.
The total computing power racing on ethereum and ethereum classic to compete for block rewards and to secure the two networks is around 160 and 13 tera hashes per second (TH/s), respectively.
Since the announcement of its plan, Linzhi has spent almost all of its initial capital on research and development of the chip design, the operations of its dozen-person team, and the order of the first batch of wafers, to bet the sample testing units will deliver the intended mining power.
Linzhi previously said it was aiming to order the first batch of wafers around December in order to have samples ready in April and mass production in June.
Speaking of the delay, the company said:
“We underestimated the complexity of the chip and how long it would take to grow the team and make the company functional. We are cautiously optimistic that we can just move forward the rest of the schedule, which would mean 12/2019 for sample machines and 02/2020 for mass production.”
One possible risk for the business is that the ethereum community has previously voted to activate the so-called ProgPow algorithm in order to remove the edge maintained by large miners that can afford expensive, specialized chips, although the timing for that switch is not yet decided. (Eventually, ethereum developers want to transition from proof-of-work to proof-of-stake, which would eliminate mining altogether.)
When asked if Linzhi has any Plan B if the switch happens, Chen said the company is, in fact, more active in the ETC community, adding:
“Our plan A is to focus on ETC mining. So if ETH will still be an option, that’s something good to have. In the ethereum community, the ProgPow plan still has some uncertainty. For the time being, we don’t see it as a market that we will obtain, so I don’t really care that much.”
In an arguably counterintuitive move, Chen said the company plans to adopt what it calls a “reverse discount” strategy when it starts to take in pre-orders if sample units prove to be successful. That would mean the more you buy, the more you are likely going to pay.
The reason is to discourage any single entity from buying too many machines and thus concentrating power over the network.
While Linzhi has not yet decided on final pricing for each unit to be sold at pre-orders, it says the goal is to achieve a payback period of four months for individual miners with a relatively small number of orders.
“This is our efforts and contribution to the idea of decentralization,” Chen said, concluding:
“Our sales will go to developers and community first, with a focus on geographical distribution, and potentially with a malus [reverse discount] for large orders. This means that small orders by individuals would be priced to hit the 4 month [return of investment] and larger orders would pay more.”
Payments giant Mastercard is to develop a blockchain-powered cross-border payments platform in partnership with enterprise-focused blockchain firm R3.
In an announcement on Wednesday, Mastercard said the two firms have inked a deal to “develop and pilot” the payments solution. It will initially be aimed at connecting faster payments schemes and banks backed by Mastercard’s clearing and settlement network.
The platform will be built on Corda Enterprise, the commercial version of the platform, as opposed to the open-source Corda Network, R3 told CoinDesk.
The partnership is planned to merge R3’s expertise at developing blockchain solutions with Mastercard’s existing payment systems and network. Ultimately, the firms hope the new platform will help tackle industry issues such as costly payments processing, liquidity management and a paucity of standardization and connectivity between banks and domestic clearing systems.
R3 CEO David E. Rutter said:
“All institutions – large or small – rely on the ability to send and receive payments, but all too often the technology they rely upon is cumbersome and expensive. Cross-border payments can be a particular pain point. Corda was designed specifically for enterprise use cases such as this, and we look forward supporting Mastercard in bringing blockchain-enabled payments businesses across the globe.”
Citing its July acquisition of international payments firm Transfast as a boost to its network, Mastercard said the deal to utilize Corda Enterprise will further expand its capabilities in the payments arena.
The news of the partnership also comes just days after Mastercard joined the Marco Polo trade finance blockchain network founded by R3 and TradeIX.
Peter Klein, executive vice president of new payment platforms at Mastercard, said in the announcement:
“Developing a new and better cross-border B2B payments solution by improving worldwide connectivity in the account-to-account space is central to Mastercard’s ambition. Our goal is to deliver global payment infrastructure choice and connectivity as demonstrated through our recent strategic acquisitions and partnerships, including our relationship with R3.
The Hyperledger technical steering committee (TSC) has elected another IBM official as its chair amid controversy over the tech giant’s increased representation on the panel.
Arnaud Le Hors, a senior technical staff member for blockchain and web open technologies at IBM, succeeds Dan Middelton, a principal engineer with Intel, according to an email sent to the TSC mailing list Wednesday.
“I’m happy to have the chair role in good hands,” Middelton wrote to the list.
A year ago Middelton replaced Christopher Ferris, CTO of open technology at IBM, who had chaired the TSC since 2016.
During the last year, the TSC launched the Diversity, Civility and Inclusion working group, which focuses on diversity broadly but is more focused on demographic rather than corporate diversity, Middelton told CoinDesk in an email.
Over the same period, the consortium has seen more collaboration between projects, like Hyperledger Ursa, a tool that was worked on by developers from Hyperledger’s Indy, Sawtooth and Fabric projects.
When it comes to influencing Hyperledger, code is king, Middleton added.
“The real influence in an open source community like this is contributions,” Middelton said. “I sort of wish that all the effort that went into discussions on the election and all the effort that will go into coming up with complex election rules just went to actual technical development.”
Neither IBM nor Hyperledger was immediately available for comment.
The Hyperledger TSC is responsible for creating working groups to focus on technical issues, approving projects and reviewing updates.
Last week, Hyperledger code contributors elected the TSC for 2019-2020, and the number of IBM employees on the committee doubled, giving Big Blue 6 of the 11 seats. This rekindled concerns that the company has an outsized influence over Hyperledger, the Linux Foundation’s umbrella group for open-source enterprise blockchain projects.
In response, executive director Brian Behlendorf suggested that the TSC discuss increasing the size of the committee with the governing board or for “one time add of a set of new TSC members, so that this greater representation can happen in the current TSC team.”
Those suggestions are already being considered by the new chair. On Thursday, Le Hors posted a proposal on the Hyperledger TSC agenda page for the next 4 candidates in line from the last election to join the current term.
“All those will be topics taken up by the TSC in what appears to be pretty short order,” Behlendorf told CoinDesk in an email.
Le Hors has worked nearly 20 years at IBM and has been involved with Hyperledger since its launch, according to his bio. He served on the 2018-19 TSC and contributes to Fabric, the oldest Hyperledger platform and the basis for the blockchain Walmart uses to track food through its supply chain.
Banking and financial services giant HSBC has completed the first yuan-denominated letter of credit transaction on a blockchain using the Voltron trade finance platform.
As Reuters reported on Sept. 2, HSBC conducted the first blockchain-based yuan-denominated letter of credit transaction deploying R3’s Corda-powered Voltron platform. In the cross-border transaction, Hong Kong-based electronics manufacturer MTC Electronics exported a shipment of LCD products to its parent firm Shenzhen MTC.
24 hours instead of ten days
The blockchain platform ostensibly enabled the parties to exchange electronic documents in 24 hours instead of the regular five to 10 days required for traditional document exchanges. Commenting on the deal, Ajay Sharma, the regional head of global trade and receivables finance for Asia-Pacific at HSBC, said:
“We are hoping that we will have something by end of the year, maybe the first quarter of next year, where will we know from Voltron what it costs, at which point, a lot of banks who might be sitting on the sidelines will be able to make a decision.”
Streamlining trade finance documents
R3 in collaboration with eight banks — including Bangkok Bank, BNP Paribas, CTBC Holding, HSBC, ING, NatWest, SEB and Standard Chartered — initially launched Voltron last October in a bid to digitize trade finance documents and attract more member banks and companies.
In August, London-based bank and financial services firm Standard Chartered completed its first cross-border blockchain letter of credit transaction in the oil industry with Thai state-owned oil giant PTT Group.
The pilot consisted of digitizing and simplifying the end-to-end exchange of information between all parties in a shipment of an oil product from Thailand to Singapore.
Binance has announced the acquisition of crypto exchange JEX in a bid to boost its crypto derivatives offerings for pro traders.
Seychelles-registered JEX offers spot and derivatives (including options and futures) trading in cryptocurrencies such as bitcoin and ether.
Going forward under Binance management, the derivatives exchange will be known as Binance JEX. JEX offers its own token, also called JEX, which will continue to be guided by its existing foundation, Binance said.
Binance plans to first distribute the tokens to users through “marketing activities and community incentives” before ultimately clawing back and burning them via means including trading commissions, according to the announcement.
Binance did not disclose the terms of the acquisition deal.
“JEX has a seasoned developer team with proven experience in cryptoasset product development. JEX has developed solid derivatives product offerings including perpetual contracts and options, which are aligned with Binance’s product roadmaps in the cryptoasset derivatives market,” said Binance co-founder Yi He.
Just yesterday, Binance announced that it had made two testnets for its planned futures platform available for user testing, with competitions to encourage user participation before a live launch.
Bitcoin (BTC) is flashing green at press time, while its share of the cryptocurrency market has reached at 30-month highs above 70 percent.
As of writing, the cryptocurrency is trading at $10,350 on Bitstamp – up 6 percent on a 24-hour basis – after hitting an eight-day high of $10,506 earlier today. At that level, BTC was up 12.7 percent from the one-month low of $9,320 hit on Aug. 29.
Over the last nine weeks, BTC has consistently found takers in the range of $9,000–$10,000. The resulting recovery rallies, however, ended up creating lower highs – a sign of bull market exhaustion – as seen in the chart below.
- Bitcoin’s price recovery from the Aug. 29 low of $9,320 is backed by an uptick in the dominance rate to 30-month highs.
- Weak trading volumes, however, indicate the recovery could be short-lived and a fall back to $9,750 could be in the offing in the next day or two. Weekly chart indicators continue to call a bearish move.
- A high-volume UTC close above the bearish lower high of $10,956 (Aug. 20 high) is needed to revive the short-term bullish outlook.
- A weekly close (Sunday, UTC) above $12,000 is needed for full bull revival.
The question now is whether the latest recovery from sub-$10,000 levels will invalidate the bearish lower-highs setup with a move above $10,956.
The gains seen in the last four days look sustainable and could be extended further, as BTC’s dominance rate – the cryptocurrency’s share of the total crypto market – has jumped to 70.10 percent, the highest level since March 2017, according to CoinMarketCap.
The gauge stood at 69 percent on Aug. 29, when BTC’s price slipped to one-month lows below $9,400.
Many observers consider price gains sustainable if they are backed by a rise in the dominance rate, as discussed last month. The shift indicates money is being poured into BTC for the long haul and not to fund purchases of alternative cryptocurrencies.
Trading volumes, however, tell another story, and suggest the recovery seen in the last four days could be short-lived.
The green bars (buying volumes) seen in the last four days on the hourly chart (above left) are smaller compared to the red bars (selling volumes) seen during bitcoin’s drop to one-month lows on Aug.29.
Buying volumes only ticked up slightly in the 60 minutes to 21:00 UTC yesterday. During that time frame, BTC rose from $10,200 to $10,470. Further, Sunday’s green bar (above right) is significantly smaller than those observed during previous breakouts above $10,000 (marked by arrows).
Put simply, the price bounce seen in the last four days lacks substance and a pullback, possibly to $9,750. could be in the offing in the next day or two.
The outlook as per the daily chart would turn bullish if prices print a UTC close above $10,956 on high buying volumes. That would open the doors to $12,000
The bitcoin bulls have failed four times in the last 10 weeks to secure a weekly close (Sunday, UTC) above $12,000. Meanwhile, the sellers have failed persistently failed to keep prices below $9,500.
A downside break looks likely, as key indicators have turned bearish, including a bearish crossover of 5- and 10-week moving averages.
The moving average convergence divergence (MACD) histogram has also dropped below zero for the first time since February, while the Chaikin money flow, which incorporates both prices and trading volumes, has slipped to a 4.5-month low of 0.10, a sign of weakening bullish pressures.
We believe that the best way for global commerce to become more efficient and accessible is by bringing cryptocurrency to the masses, says Flexa app makers
More than 10 years after bitcoin was founded, user adoption remains one of the biggest challenges still facing the world’s largest cryptocurrency. To solve this, Flexa built an app called Spedn, which allows cryptocurrency holders to make instant payments to merchants that accepts Flexa as a payment provider.
“The Flexa team has decades of payments experience, and at this point, we believe that the best way for global commerce to become more efficient and accessible is by bringing cryptocurrency to the masses,” the company wrote in a blog post last year.
“By making cryptocurrencies spendable in mainstream commerce, our sincere hope is that we can help bring the full promise of blockchain technologies to people all over the world.”
Flexa claims that Spedn will not only benefit consumers who want to spend cryptocurrency, but also the merchants who accept it. “Accepting cryptocurrencies in their stores [will] reduce payment fraud and processing costs,” the startup stated.
No additional hardware or software is needed on the retailers’ side in order to integrate the payments, they only need to allow Flexa to be a new payment provider on their existing systems.
For customers, the process of paying is similar to existing digital payment methods like Apple Pay and Google Pay. Once the Spedn app is downloaded, payments can be made by scanning an automatically generated QR code to the payments terminal at the till.
One of the other issues facing cryptocurrency in its quest to become a mainstream form of payment is price volatility. Recent positive news in the cryptocurrency space, for example, has seen the price of bitcoin shoot up by around $2,000 over the last two days – which Flexa’s announcement may well have contributed to.
To counter this, Flexa has partnered with New York-based cryptocurrency exchange Gemini so that payments can be made using a so-called stablecoin pegged to the US dollar.
Flexa has only announced a limited list of retailers, which include Whole Foods, Nordstrom and Lowes. However videos shared online also show Starbucks accepting cryptocurrency payments through the app.
In total, around 100 merchants are expected to accept cryptocurrency payments through the Flexa app by the end of the year, totalling more than 30,000 stores.
Eventually, Flexa wants to make it possible for any shop to accept any cryptocurrency.
“As the Flexa network grows, we hope to show the world just how transformative cryptocurrencies can be for all kinds of payments, not just peer-to-peer transactions, but also retail paumnets, dining and beyond,” Flexa’s announcement stated.
“The world of payments is evolving quickly now, and we believe that Flexa will be a massive part of the shift toward more efficient and more accessible commerce around the globe.”
Wednesday, July 31 — crypto markets are seeing widespread green, with Bitcoin (BTC) breaking back above $9,700 and many large market cap altcoins seeing solid gains of between 3 and 9% on the day.
Despite trading in a lower price range since dropping back to a four-figure price point in a recent corrections, BTC is today up a solid 2.4%, bringing it to $9,717 by press time.
This mild uptick nonetheless stops short of bringing the coin back into the green on its 7-day chart, where Bitcoin is still reporting a fractional 0.7% loss. On the month, losses are starker, topping 8%.
Yesterday, Peter Tchir — a former Executive Director at German multinational investment bank Deutsche Bank — argued that Bitcoin is an indicator of hidden geopolitical tensions, pointing to the coin’s momentous performance this May at a time of fraught trade talks between the United States and China.
Also this week, erstwhile Bitcoin bear and CNBC host Joe Kernen predicted that the top coin could hit $55,000 — a 500%+ price surge — by the time of its next halving in May 2020.
Top altcoin Ether (ETH) — which celebrated its fourth birthday yesterday — has posted a 1.9% to trade around $212 by press time. In corrections earlier this week, the coin had circled perilously close to the round $200 mark, but has since recovered ground and is just slightly in the red, at 2.2%, on its 7-day chart. On the month, however, Ether is down over 18%.
XRP is reporting a 2.7% gain on the day, while among the remaining top ten coins several alts are seeing stronger upward momentum: Bitcoin Cash (BCH) is posting a 7.5% gain on the day, Litecoin (LTC) is up 3.6% and Binance Coin (BNB) is up 4.1%.
In the context of top twenty coins, Tezos (XTZ) is outstripping all other assets, seeing a 24% gain on the day following news of the token’s listing on major United States crypto exchange Coinbase. At press time, XTZ is trading at $1.24
Still among the top twenty, strong gains are being reported by Chainlink (LINK) — up over 9% — as well as by NEO (NEO), IOTA (MIOTA) and Cosmos (ATOM), all of which are up by 4-5%.
Total market capitalization for all cryptocurrencies is at $261,434,827,781 at press time, according to Coin360 data.
Dominating the crypto headlines this week is the hearing devoted to examining regulatory frameworks for cryptocurrencies and blockchain held at the United States Senate Banking Committee. Cointelegraph reported live on the most important developments during the hearing as it unfolded.
Yesterday’s Committee hearing notably follows upon earlier hearings in mid-July that had examined the regulatory hurdles surrounding Facebook’s Libra.
Despite the lack of decisiveness in the bitcoin market following the dominant crypto asset’s abrupt drop from $14,000 to $9,500, many analysts – even bearish ones – generally remain confident that the bitcoin price is heading towards a new record high in 2020.
On CNBC’s Squawk Box, as CCN reported, prominent news anchor Joe Kernen emphasized the imminence of the next halving of the Bitcoin blockchain protocol, suggesting that it could act as a major catalyst for the asset over the medium to long term.
Bitcoin price should surge as one crucial event disrupts supply & demand ratio
In recent years, the bitcoin price has been primarily driven by supply and demand from the market. As the market capitalization of the asset grew, the impact of news and events have started to lessen.
The block reward halving of bitcoin, which occurs approximately every four years, is expected to have a fundamental effect on the circulating supply of bitcoin, altering the rate at which new BTC are mined.
On the Bitcoin blockchain protocol, users mine BTC to secure transactions and process payments using mining equipment and electricity. In return for the consumption of resources, miners are rewarded with BTC, which then is sold, primarily through over-the-counter (OTC) markets.
During or around May 2020, the amount of BTC miners receive for processing transactions on the Bitcoin blockchain protocol will decline by half, leading to a decline in the inflow of BTC into the global market from miners.
‘You’re on Your Own’: UK Watchdog is Fear-Mongering Bitcoin Investors
Dow Rebounds After Mnuchin, Lighthizer Conclude ‘Frank’ Shanghai Talks
“With what we produce of gold every year, it would take 62 years to produce that much gold. If you do the same kind of analysis using bitcoin or silver or anything, you can come up with some of these flow metrics that are highly correlated. Silver I think is 22 years and gold is… and in the next halving, bitcoin, all of the sudden, gets close up to where gold is…. we will see anyway.”
Due to the block reward halving and other technical indicators, technical analysts who remain bearish on the short-term trend of bitcoin have stated that in the long-term, the trajectory of the dominant cryptocurrency is likely to be positive.
OB1, the developers behind the online decentralized marketplace and currency trading platform OpenBazaar announced a mobile counterpart called Haven.
Haven allows users to buy and sell goods and services directly with each other, using cryptocurrencies, without relying on middlemen who take a cut of merchants’ transactions or gather shoppers’ data.
The app is organized into four sections: shopping, social, chat, and a non-custodial multi-wallet. For all features of the peer-to-peer network, user information is stored locally and protected with end-to-end encryption, meaning only the parties involved in the sale or conversation are able to see the details.
Since OB1 launched its 2.0 of OpenBazaar, 250,000 nodes joined the permissionless network. Jenn Cloud, OB1 communications lead, said “there is a core user base of several thousand who frequently use the software and many more are casual users.” A substantial proportion of the “long-lasting nodes” are merchants.
“We’ve heard many stories from merchants about finding OpenBazaar a refugee from the high fees, restrictive terms and conditions, and poor treatment of merchants on eBay and Amazon.”
The app has many of the same features as OpenBazaar, but does not support P2P cryptocurrency trading. Additionally, dispute moderation is only supported by the desktop client.
The social feature is new and enables users to easily communicate with each other. Importantly, it is “not connected to transactions or any other activities on the network and will never post anything automatically,” said Cloud.
Like OpenBazaar, Haven will support BTC, BCH, ZEC and LTC. The representative said plans for a previously reported native token, OBC, are currently on hold.
Looking forward, however the team plans to add Ethereum support. Also, though “no firm plans have been made by the OB1 team… several in the OpenBazaar community have begun work to see if it’s possible to support Monero,” said Cloud.
Haven is available in the Apple App Store and Google Play. This week, the company is offering special deals, such as fifty percent off select electronics and Haven store gift cards, posted in the app “at undisclosed times.”
OB1 has raised $9.25 million to date from investors including Union Square Ventures, Andreessen Horowitz, OMERS Ventures, BlueYard, Bitmain, Digital Currency Group, and venture capitalist William Mougayar.
Rival manufacturers of blockchain smartphones, Samsung and Pundi X, appear to see the benefits of working together on crypto adoption.
Announced by Pundi X in a blog post on Monday, the firms have entered a symbiotic relationship regarding their wallet tech, with Pundi X integrating with Samsung’s Blockchain Wallet and making its XWallet available to the Galaxy S10 phone’s blockchain app options.
“This presents a unique opportunity to push blockchain technology and blockchain-based digital assets into the mainstream, reaching the millions of Samsung smartphone users around the world,” firm says in the post.
Pundi X claims the news makes it the first fintech app in the S10’s blockchain ecosystem.
S10 users adding XWallet to the Samsung Blockchain Wallet will be able to move cryptocurrencies between the two apps. Pundi X suggests that users can use Samsung’s wallet to store cryptos securely, “like a savings account,” and moving them to the XWallet “checking account” for use in payments.
Pundi X added that, with XWallet recently becoming available via XPOS – the firm’s blockchain point-of-sale device – more payment options will be on offer for S10 users as a result. XWallet is also connected with XPASS, Pundi X’s NFC-enabled crypto payment card product.
The firm said:
“The XWallet’s integration with the Samsung Blockchain Wallet thus makes Pundi X payment ecosystem available to a much wider audience, allowing the Samsung Galaxy smartphone users to not only store their ETH securely but also transfer to XWallet and spend it in a variety of shops, opening their doors to the new generation and their preferred cryptocurrencies.”
Samsung launched its S10 flagship phone back in March, revealing a bold blockchain play that saw it offer the crypto wallet alongside decentralized apps (dapps), merchant payments and other features such as blockchain signing.
Details of Pundi X’s device were aired at the Mobile World Congress conference in Barcelona in February and a launch is expected later this year. The prototype XPhone is said to be able to make callsover a blockchain.
The cash-counting machines were softly buzzing in an office with floor-to-ceiling windows overlooking Moscow’s landmarks.
“Hear that sound?” asked the head of an over-the-counter (OTC) cryptocurrency trading desk — let’s call him ‘Oleg’ — who requested his real name and company be withheld. “You can hear it 24/7 in here.”
Business is brisk thanks to a constant flow of Chinese merchants who come in daily with heavy bags of cash. Oleg said his OTC desk sells about $3 million worth of crypto every day. Most of it usually goes to China. But what’s perhaps most surprising is which crypto.
Only 20 percent of Oleg’s sales are in bitcoin, the oldest cryptocurrency with the largest market capitalization. The other 80 percent is in the dollar-pegged token known as tether, or USDT.
Tether’s best-known application is allowing crypto traders to move money between exchanges quickly to take advantage of arbitrage opportunities. But according to several Moscow OTC traders, it has at least one real-world use case – as the go-to remittance service for local Chinese importers.
The total volume of USDT purchased by Chinese businesses can reach $10 million to $30 million daily, these traders said.
“They accumulate a lot of cash in Moscow and need tether to transfer it to China,” said Maya Shakhnazarova, head of OTC trading at Huobi Russia, the Moscow office serving high-roller clients of Singapore-based exchange Huobi Global.
It’s a simple process.
“A client comes with cash, we register the price at exchanges, when we agree on a price, we make a deal,” Shakhnazarova told CoinDesk. “The client hands over cash and a wallet address, the seller sends USDT to the wallet.”
Why tether? It has the usual advantages of crypto – no limits on how much money can be sent or where – without the volatility that makes most coins infeasible for moving millions across the border daily.
Despite longstanding questions about USDT’s purported dollar backing, exacerbated by the New York State Attorney General (NYAG) court case against the issuing company Tether, the stablecoin usually trades around $1.
The tether-for-rubles purchases often take place in offices like Huobi’s in the steel-and-glass skyscraper district of Moscow City.
“There are a lot of OTCs here in Moscow City, a bunch of offices in every building, and the volumes for them all can reach several dozens of millions of dollars a day. It’s all paid for in cash,” Shakhnazarova said.
Tether’s killer app
Chinese grey-market importers used to rely on bitcoin before the 2018 bear market, another OTC dealer, Roman Dobrynin, told CoinDesk. As the price was ever-growing, merchants and the intermediaries helping them buy crypto could make some extra money along the way.
But since the beginning of 2018, hoping that your bitcoin will still be worth the same or more at the end of the transfer became too risky.
“As the price was going down, tether became much more convenient to use,” said Dobrynin. “China is totally reliant on USDT, they trust in it a lot, plus it’s very liquid.” His own clients are mostly Chinese, and they usually find him by word of mouth, connecting via Telegram.
To buy or sell USDT for dollars from Tether itself, a trader must be verified through the company’s know-your-customer (KYC) process. However, since the token runs on top of public blockchain networks (bitcoin, ethereum and tron), anyone can receive or send it, and secondary trades are unrestricted.
Tether did not respond to requests for comment by press time.
Back in China, the merchants can exchange USDT for fiat easily, even though the People’s Bank of China banned fiat-to-crypto spot trading in September 2017, forcing the exchanges to move out of the country and limiting trading to crypto-to-crypto pairs.
Chinese traders who need to liquidate crypto assets into Chinese yuan can still go to an OTC market maker, such as those registered on exchanges like Huobi and OKEx, to get matched with buyers and send them crypto after receiving a wire transfer via a bank, AliPay or WeChat Pay.
Critics of Tether have long questioned whether the stablecoin was fully backed 1:1 with dollars, as the company long insisted. The NYAG case revealed that Tether had loaned a big chunk of its capital reserves to Bitfinex, an exchange with overlapping management and owners, leaving the coin only 74 percent collateralized by cash and equivalents.
None of this seems to faze the Moscow traders or their Chinese clients.
“Nobody actually cares if tether is backed or not,” says Konstantin Plavnik, chief operating officer of Moscow-based crypto derivatives exchange Xena. Confidence in Tether’s solvency relies on long-time habit and convenience: this market needs tether, so tether is trusted.
OTC traders also point out that USDT’s daily volume exceeds its supply in circulation several times over, which indicates that people turn the token around multiple times during the day. For example, according to CoinMarketCap, on July 29, the 24-hour volume of USDT was recorded at $17.5 billion, while the total supply was just around $4 billion.
The turnaround of tether is fast, so for the merchants using the token for remittances, whether it’s worth something or not matters only within one day. Large batches of USDT get transferred to China overnight and then exchanged for yuan, crypto entrepreneurs in Moscow told CoinDesk.
“USDT will stay propped by the power of habit and trust of its users,” said Vladislav Bulochnikov, the head of product at crypto wallet app provider Chatex. “Even if it loses half of its backing — it’ll still be out there.”
Skirting capital controls
Stepping back, the Chinese government maintains strict capital controls, limiting the amount of foreign currency anyone can buy or sell to $50,000 a year. People can apply for an additional quota, but still the amount of currency they can buy and sell will be limited. In this situation, some Chinese have opted to use crypto to move money across the border, Bloomberg reported in 2017.
The fact that Chinese merchants bringing cheap goods to Moscow’s shopping malls use crypto to move money around was all but officially recognized by the Russian authorities last year.
Several large malls in the city account for around $9.5 billion of unregulated cash flow monthly, and most of the merchants are from China, said Yuri Polupanov, the Bank of Russia’s head of financial monitoring and currency control, during an event hosted by Thomson Reuters in Moscow in April 2018.
These malls, located inside huge warehouses on the outskirts of Moscow, host multiple retail stands, selling mostly clothing, usually for cheap and for cash. They are shopping Meccas for people who can’t afford to spend much on their wardrobes and avoid even mass-market chain stores.
“We see most of the revenue turned into cryptocurrency, which is not reported in any way at the moment,” Polupanov said at the Thomson Reuters event, according to the RBK news agency. “We see simultaneous transfers of that cryptocurrency via email to the homeland of those merchants and producers, and the following exchange of it for the local currency there.”
According to a March 2019 report in the Russian newspaper Novaya Gazeta, cash would be received at places like a hotel called “Druzhba” (“Friendship” in Russian), located next to the shopping mall named “Moscow.” Then this cash would be swapped for crypto and sent to Hong Kong.
The wholesale trade offices at Druzhba could be turning around $10 million to $12 million daily, Novaya Gazeta’s sources estimated.
The operations were ceased for a short time after police raided the hotel, along with the malls mentioned by the Bank of Russia, in March of this year.
Small crypto desks are still functioning at those malls, OTC trader Dobrynin believes, though they likely don’t provide the volumes merchants need.
Outside traders are often afraid to go to those areas to make deals as things can get dangerous there, he said, explaining: